Footnote:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments October 3, 2018 erstellt
Description:
We provide novel evidence that frictions in the financing of working capital can limit firms'production capacity, leading to the amplification and propagation of liquidity problems overtime. We propose a new approach to identify this firm credit multiplier that compares how asame firm responds to permanent shocks differently when these shocks are initiated in the periodin which they are predicted to be most profitable (their “main quarter”). Our analysis implementsthis test with oil price shocks and provides extensive evidence supporting our identificationstrategy. Our results suggest that the financing of working capital can be an important channelfor understanding the real effects and determinants of short-term funding problems faced byfirms